Foot Locker has determined one loyalty program is healthier than eight.
For greater than 10 years, Foot Locker has had a constant, comparatively profitable loyalty program referred to as VIP. However the corporate has grown from a single retailer to a portfolio of manufacturers that features Champs, Eastbay, Footaction, Girl Foot Locker and Youngsters Foot Locker. All have had particular person loyalty programs related to them. Now, the corporate is throwing out all of these siloed programs in favor of a unified loyalty system that encompasses each Foot Locker model.
FLX, the brand new common loyalty program, was developed over the past two years by Hope Tannenbaum, who was employed by Foot Locker as head of CRM, loyalty and analysis, particularly to retool the corporate’s loyalty scenario. When this system launches within the subsequent few weeks, clients will be capable of earn factors at any Foot Locker retailer, in addition to via sneaker resale platform Goat, which the corporate doesn’t personal however has a big stake. Berger mentioned FLX could ultimately broaden to different Foot Locker investments, as properly. They’ll redeem factors in a single, central on-line rewards heart. Extra factors earned will put clients into larger tiers with higher rewards to redeem.
“We all know our Most worthy clients are those who store throughout all our manufacturers, however we haven’t actually finished something to encourage that conduct till now,” mentioned Jed Berger, CMO of Foot Locker. Foot Locker sees explicit worth from ladies VIP members at Girl Foot Locker. “We’ve received fairly a portfolio, however it’s cut up by all these partitions. We’re throwing out our previous methods. FLX is our manner of encouraging individuals to buy throughout all our banners.”
This system is free to affix and offers each member free transport on all orders with no minimums, one thing that may probably be a serious draw for patrons not already a part of Foot Locker VIP. Current loyalty members at any of Foot Locker’s manufacturers can be migrated over to FLX when it launches. Berger mentioned the launch will even be promoted on commonplace digital channels like social media, e mail and cell push notifications, as properly via in-store employees, who can be educated to advocate the service.
Every Foot Locker model’s web site will comprise a hyperlink to the common rewards heart, the place clients can redeem factors (earned at a price of 100 factors per greenback) for a wide range of rewards, together with sneakers, reward playing cards and entries into sweepstakes. Berger mentioned a lot of Foot Locker’s model companions can be collaborating in this system by providing unique merchandise and experiences as rewards. Though he couldn’t give a full record, a pre-launch model of the rewards heart options merchandise from Nike, Converse and Vans, which Berger mentioned was indicative of the sorts of manufacturers that can be out there via FLX.
FLX will even carry adjustments to how Foot Locker members can entry drops. Beforehand, Foot Locker’s drop instruments, like a launch calendar and choices for coming into raffles, had been all in separate areas. Now, all these choices can be mixed into one location on FLX.
This extends to “Head Begins,” which within the previous system had been benefits given to VIP members within the type of early entry to drops. Members in the next tier of the VIP program got even earlier entry. Within the new system, in line with Foot Locker’s director of cell Shana Seubert, each FLX member will get one Head Begin, no matter their tier in FLX, and extra will be acquired by redeeming them for factors via the rewards heart. The shop check-in element of Head Begins can be eradicated.
Tannenbaum mentioned that the brand new system is supposed to show loyalty from a passive factor that clients might ignore to one thing that will get them to extra actively have interaction with Foot Locker and that drives up lifetime worth.
“It’s not essentially that the earlier system wasn’t working, however we needed to maneuver from a transactional program to a extra experiential program,” Tannenbaum mentioned. “And this technique is much more versatile. We tinkered with the numbers so much in improvement, and the good factor is that we are able to regulate this on the fly. We are able to transfer stuff out and in of the rewards heart, and usher in new issues at any time when.”
Foot Locker’s income has been rising slowly over the previous couple of years, with complete gross sales growing from $1.86 billion within the third quarter of 2018 to $1.93 billion in the identical quarter in 2019. On the similar time, the corporate has been on a little bit of an funding and acquisitions kick, dumping $100 million into Goat and $25 million into Carbon38, and making investments in Rockets of Superior and Tremendous Heroic. In keeping with Berger, not solely does the corporate wish to develop its portfolio, however it additionally needs to tie its numerous manufacturers collectively in a extra cohesive manner, saying that FLX is simply the beginning of extra intra-brand initiatives sooner or later.
“Having completely different [brands] catering to completely different audiences is a bonus, and we don’t wish to lose that,” Berger mentioned. Foot Locker tends to focus extra on sneakerheads, whereas different banners like Champs are typically barely extra performance-focused. “That mentioned, we wish to handle sneaker and youth tradition in actually massive methods, and that is the primary of many alternatives to make use of our whole portfolio to do this.”